The price of bullion, a haven asset, has sunk on optimism
that a U.S. economic recovery will curb the need for stimulus
spending. A price collapse last week, exacerbated by concerns
that Cyprus may sell gold, took losses to more than 20 percent
since the record close in September 2011, meeting the common
definition of a bear market.

The turn in the gold cycle is quickening and investors
should sell, Goldman Sachs Group Inc. said April 10. Bullion for
immediate delivery fell 6.2 percent last week, and was down as
much as 8.5 percent at $1,356.31 an ounce today. Silver declined
as much as 11 percent to $23.02 an ounce.

“This latest rout is surprisingly severe,” Investec
Securities Ltd. said in a note to investors. “Many miners will
be feeling considerable pain. This pricing environment, if
sustained, would likely have a material adverse impact on mine
supply that would be supportive longer term.”

Petropavlovsk, which was cut to sell by Citigroup Inc.
today, earlier fell as much as 30 percent on concerns about its
high levels of debt.

Petropavlovsk “is in the position of being one of the very
few gold groups not carrying net cash as it passed the gold
cycle-peak,” Citigroup said today. “A feature which does not
lend itself to huge investor confidence during a gold price
downturn.”